Pest Analysis Of The Global Macro Environment : Ryanair

Economic The oil prices are being expensive but declined by 50% as ever since the peak retreating to 2007 levels. Therefore, the decline in fuel fact gave power to the dollar currency (IMF, 2008). It is possible that a there will be a reduction of a certain amount of travelling business as companies are cutting functions in order to decrease costs, they 're there are other alternatives means of communication like telecom fencing. British airways is a very weak company as the UK operating airline to a poor exchange to a rate.

Ryanair sometimes get in trouble with bodies such as the Advertising Standard Authority (ASA) in the UK over differences between advertised and actual price - in fairness to Ryanair these are rare mistakes.

As can be understood from the analysis given below, if British Airways can cut it’s staffing by 25%* and increase it’s utilization to 90% from 60%, it shall be able to reduce the prices significantly to I£104, still I£6 more than Ryanair. As British Airways is a renowned market leader, people would be inclined to travel by British Airways by paying the I£6 extra than by a relatively unknown carrier Ryanair. Also, such a reduction in tariff on all of BA’s routes might not be necessary. It can very well position separate flights/routes for this rate so as to offset any reduction in utilization through profits in other routes.

The strategic plan of Ryanair has been to establish itself as Europe’s leading low-fares airline.” Ryanair aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies.” (www.ryanair.com)

Since Ryanair is looming their highest return-on-capital route, it was expected that, not to lose the passengers volumes, both airlines will start to offer lower fares and greater frequency of flights. It is not likely that BA and AL will try to match the exact prices of Ryanair because they have other factors that would influence their customer base to remain loyal. Also, the majority of their costs are fixed, making it difficult for them to quickly reduce their operating expenses without significant financial losses. Not only will BA and AL have to figure out ways to lower their costs, they will also need to reassess the limitations they have on their tickets. Ryanair is offering tickets without any restrictions, so even if BA and AL came close to their price, the customer may still choose Ryanair if the others do not make policy changes. They offer a variety of classes of service, from first to economy, while Ryanair has less complicated offer - one class on one type of plane. BA and AL were assuming that the deregulation of the airline industry, particularly in the United Kingdom, will allow them to expand their routes and cover more of their significant overhead. Some expected

The increase in airfare will causes traveling demand to decrease since people are finding out means to travel rather not travel as much anymore since they are not willing to paying for the higher price.

There are many economical factors that could affect an airline company. Britain’s decision to leave the EU in the BREXIT vote has prompted a major fall in the value of the pound in comparison to the dollar and euro. As for the vote's bearing on IAG itself, Walsh said: "Because we buy fuel in dollars, our fuel bill will rise on the higher oil price and the weaker pound..” As airlines buy fuel in dollars it will cost them more money when paying

Prior to 1991, Ryanair had suffered from continuous losses from 1985 to 1989. The first reason that put it into this situation was that it tried to position itself as a low fare airline with the first rate services. It tried to keep low and unrestricted fare, while keep focusing on the best customer service and relationship. This mixed model was proven inefficiency. The low price could lure number of

Since the airline industry is a direct product of market conditions, it is greatly affected by all externalities. Many people noticed a decline in travel after the September 11th tragedy occurred due to safety concerns. When there is a huge increase in fares that definitely interferes with the demand for travel; it causes the price of tickets to continue to rise since a clear correlation between supply and demand exists. When the economy is doing well in terms of the employment rate, and when the dollar is strong people have the tendency to travel more (Jerram,1998).

There are also other charges such as credit card booking fee and other transaction charges that could apply at times which are not properly disclosed. Ryan air also charges customers for use of wheel chairs. On a round trip, the seat for the return journey is charged at times. Even when a customer does an online check in and facilitates the airline by not queuing up at the counter, Ryan Air charges a web check in fee. It also charges a huge sum of 40 pounds per passenger who fails to print his

·     The Civil Aviation Authority (CAA) is responsible for setting ‘…price caps on airport charges…at airports designated by the Secretary of State’ (www.caa.co.uk). One of these is Stansted, which has hitherto ‘…benefited from discounted airport charges and cross-subsidy from the higher charges paid by the airlines at Heathrow and Gatwick airports’ (Done 18/12/03). CAA’s new requirements command airport financing without cross-subsidisation on a stand-alone basis. Consequently discounts will be removed and charges possibly increased. Ryanair has protested as it will raise its costs (Done 20/10/03).

Swift market responses need to be made by Ryanair, such as capitalising on the failure of other European airline by opening new routes on their existing failed ones, this will achieve greater economics of scale and thus costs fall. Ryanair should continue to look at the many airlines that have a limited geographic area

Since 2001, NEXT has created the next day delivery service on most home shopping orders. Currently there are more than 2 million customers in the UK and over 70% of NEXT 's home shopping business is now transacted online (nextplc.co.uk, 2011). Additionally, in October 2007, Meadow Hall in Sheffield became one of the first concept stores NEXT had fitted out in the new style that is now commonplace throughout its UK outlets (careers.next.co.uk). These events highlight the firm’s consideration of its customers and ability to diversify the service to satisfy customers’ needs.

Ryan air, an Irish airline started in 1985 by Ryan family with a capital share of £1 and a staff of 25. Over the past few years the company has shown tremendous ontogeny. Indeed it is Europe's largest low cost carrier and fastest growing airlines. Currently it’s operating more than 1,500 flights every day from over 50 bases and around 1400 low fare routes across 28 countries which connect 165 destinations.

We will see how Ryanair was successful as world’s one of the most favoured low-fare airline and how did it apply each of this mix by putting in the